sky lexus

Just had to tow my 1994 Lexus LS 400 to the shop. Engine runs fine, no check engine light, but the transmission briefly goes into gear and then totally slips. The shop just said that the fluid smells burnt and quoted me a junk yard price ($2300) and a reman. price ($2900). He also said that he could drop the pan, replace the fluid and filter for $177, but doesn't think that would help. Anyone have an opinion or suggestion?